TRAI allows a period of 12 months post-merger to comply with the 50% RMS threshold rule. So, if the merger is effective Jun-18 (i.e. all approvals obtained within one year from now), then Idea/Vodafone has time till Jun-19 (two years from now) to make the adjustment. During this 2-year period, RJio will register revenues taking share, largely against the smaller players, which should not impact the combine too much by way of needing to cede excess revenues. Sure, if the India telco market gets back to a robust growth trajectory, revenue dis-synergy is not as big a concern as the current Math (worryingly) suggests – it means that the combine wouldn’t need to cede much absolute revenues in Jun-19 as it will have had a lower % (closing the gap to 50% threshold) of a larger industry revenue base.

But what if the market does not grow nearly as much as the combine expects and has estimated in the merger model? In a stagnant market, even if we assume that RJio will take share substantially against the smaller players, Idea + Vodafone’s high RMS will require the combine to cede revenues. To the extent that RJio takes more revenue share from Idea + Vodafone in a stagnant market, the combine has ceded the excess revenues upfront ahead of TRAI-deadline taking effect, in any case.